Swartz v. Matal
| Decision Date | 22 August 2017 |
| Docket Number | No. 1:17-cv-482 (LMB/TCB),1:17-cv-482 (LMB/TCB) |
| Court | U.S. District Court — Eastern District of Virginia |
| Parties | MITCHELL R. SWARTZ, Plaintiff, v. JOSEPH MATAL, Performing the Functions and Duties of the Under Secretary of Commerce for Intellectual Property and Director of the United States Patent and Trademark Office, Defendant. |
Before the Court is defendant Joseph Matal's Motion to Dismiss [Dkt. Nos. 15 and 16], which has been fully briefed. For the reasons that follow, defendant's motion will be granted.
Plaintiff Mitchell Swartz ("plaintiff" or "Swartz"), proceeding pro se, is a medical doctor, electrical engineer, and inventor who holds several patents both in the United States and abroad. Compl. [Dkt. No. 1] ¶¶ 7, 9. At issue in this civil action are six patent applications—U.S. Patent Serial Nos. 12/932,058 ("the '058 application"), 12/589,258 ("the '258 application"), 13/544,381 ("the '381 application"), 12/316,643 ("the '643 application"), 09/748,691 ("the '691 application"), and 09/750,765 ("the '765 application")— all of which plaintiff describes as relating to inventions that allegedly generate heat and electricity quietly and efficiently. Compl. [Dkt. No. 1] ¶¶ 10, 18.
Each application went through the internal two-stage review process at the United States Patent and Trademark Office ("USPTO"). At the first stage, each application was assigned to a patent examiner, who reviewed its claims to determine patentability. See 35 U.S.C. § 131. For each application, the examiner determined on both an initial review and after reconsideration that the claims failed to meet the legal requirements for patentability. Cf. id. § 132. After the examiner twice rejected each application, plaintiff filed appeals with the Patent Trial and Appeal Board ("PTAB" or "Board"), an administrative appellate tribunal inside the USPTO. See id. § 134(a). The PTAB affirmed the rejection of five of his applications; however, the appeal of the sixth, the '381 application, is still pending.1 See Mem. in Supp. of Mot. to Dismiss ("Def. Mem.") [Dkt. No. 18] 6. Dissatisfied with the decisions of the PTAB, plaintiff has exercised his right under 35 U.S.C. § 145 to bring the present civil action against the Director of the USPTO, in which he requests in Count 1 that the Court find that he is entitled to a patent on each application. See Compl. [Dkt. No. 1] ¶¶ 315-19. Plaintiff also alleges that the USPTO and its officers have engaged in a variety of misconduct while evaluating his applications. The Complaint includes thirteen additional counts based on these allegations: two counts alleging violations of constitutional rights, one negligence-based tort count, one access-to-records count, eight counts alleging violations of various criminal laws, and one count alleging civil violations of the Racketeer Influenced and Corrupt Organizations Act ("RICO"). See id. ¶¶ 320-60.
Defendant has moved to dismiss each of the fourteen counts for a variety of substantive and procedural reasons, see Def. Mem. [Dkt. No. 18], plaintiff has responded, see Mem. in Opp'n to Mot. to Dismiss ("Pl. Opp.") [Dkt. No. 25], and defendant has replied, see Reply in Supp. of Mot. to Dismiss ("Reply") [Dkt. No. 29]. Finding that the briefs are comprehensive andthat oral argument would not aid the decisional process, the Court will resolve defendant's motion on the materials submitted.
Defendant bases his Motion to Dismiss on Fed. R. Civ. P. 12(b)(1) and 12(b)(6). First, he argues that Count 1 should be dismissed under Rule 12(b)(6) for failure to state a claim because plaintiff does not plausibly allege entitlement to a patent for his various applications, all of which relate to "cold fusion," a "hypothetical technology that has not been shown to be technically feasible."2 Def. Mem. [Dkt. No. 18] 1, 14-22. Second, he argues that under Rule 12(b)(1), the Court lacks subject matter jurisdiction to consider some of the patent claims and all of the non-patent claims for a variety of reasons, including sovereign immunity, collateral estoppel, failure to administratively exhaust, and failure to establish a private right of action. See id. at 8-13, 22-28.
Under Rule 12(b)(1), a civil action must be dismissed whenever the court lacks subject matter jurisdiction. Although the plaintiff has the burden of establishing subject matter jurisdiction, Demetres v. East West Const., Inc., 776 F.3d 271, 272 (4th Cir. 2015), a court should accept "as true the jurisdictionally significant facts claimed by the" plaintiff, Motley v. Va. State Bar, 403 F. Supp. 2d 468, 471 (E.D. Va. 2005). After accepting those facts as true, thecourt must determine "whether those facts are sufficient as a matter of law to establish subject matter jurisdiction." Id.
Under Rule 12(b)(6), a civil action must be dismissed if the complaint does not "contain sufficient facts to state a claim that is 'plausible on its face.'" E.I. du Pont de Nemours & Co. v. Kolon Indus., Inc., 637 F.3d 435,440 (4th Cir. 2011) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). Although the court must assume for the purposes of deciding the motion that all "well-pleaded allegations" are true and must "view the complaint in the light most favorable to the plaintiff," Philips v. Pitt Cnty. Mem'l Hosp., 572 F.3d 176, 180 (4th Cir. 2009), allegations that are merely conclusory need not be credited, see Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009).
Count 1 alleges under 35 U.S.C, § 145 that plaintiff's six patent applications—the '058, '258, '381, '643, '691, and '765 applications—should be granted. Defendant argues that three of these applications are ineligible for this Court's review because the PTAB has not yet rendered a final decision on the '381 application and plaintiff is collaterally estopped from arguing for the patentability of the '058 and '765 applications. Defendant further contends that plaintiff's allegations as to the remaining three applications should be rejected because he has failed to plausibly allege that they involve patentable claims.
It is uncontested that plaintiff's appeal of the examiner's denial of the '381 application was still pending at the PTAB when he filed this action. See Def. Mem. [Dkt. No. 18] Ex. 13 (). Apatent applicant may only bring a suit under 35 U.S.C. § 145 if he is "dissatisfied with the decision of the Patent Trial and Appeal Board in an appeal under" 35 U.S.C. § 134(a). Section 145 waives the federal government's sovereign immunity only when the PTAB has issued a final decision on the patent application at issue. See Fleming v. Coward, 534 F. App'x 947, 950 (Fed. Cir. 2013). Therefore, because the PTAB has not issued a final decision on the '381 patent application, defendant retains its sovereign immunity and plaintiff's suit must be dismissed with respect to that application. See id.
In response to this argument, plaintiff does not claim that the PTAB has issued a final decision on his application; instead, he appears to claim that the PTAB's "refusal to admit Evidence and Briefs" into the record during the appeal "were final decisions." Pl. Opp. [Dkt. No. 25] ¶ 112. To the contrary, these decisions are the antitheses of final decisions; they are, indeed, only intermediate decisions preceding a future final decision on the patentability of the claims in the '381 application. As such. Count 1 will be dismissed as to the '381 application.3
Under the doctrine of collateral estoppel, a party may not relitigate an issue that is (1) identical to an issue (2) actually litigated in an earlier proceeding if (3) resolution of the issue was necessary to the judgment in the earlier proceeding and (4) the party had a full and fair opportunity to litigate the issue in the earlier proceeding. Jet, Inc. v. Sewage Aeration Sys., 223 F.3d 1360, 1366 (Fed. Cir. 2000). Defendant argues that two of plaintiff's patent applications (the '058 application and the '765 application) are "substantively identical" to two earlier applications (Application Nos. 08/406,457 and 07/760,970) that plaintiff submitted to theUSPTO. Def. Mem. [Dkt. No. 18] 9-13. The USPTO rejected both of the earlier applications for lack of utility under 35 U.S.C. § 101 and for lack of enablement under 35 U.S.C. § 112. See id. Plaintiff appealed the rejection of both applications to the Federal Circuit and, in both cases, the Federal Circuit affirmed the Board's determination that the patent applications failed to satisfy §§ 101 and 112. See id.; In re Swartz, 50 F. App'x 422, 424-25 (2002) (per curiam); In re Swartz, 232 F.3d 862, 864 (2000) (per curiam).
In response, plaintiff does not contend that the claims at issue in the current applications are distinct from the claims at issue in the earlier applications; instead, he argues that "collateral estoppel is not appropriate here because here there are new materials and evidence." Pl. Opp. [Dkt. No. 25] ¶ 58. He also appears to believe that because the earlier cases proceeded under 35 U.S.C. § 141, rather than § 145, collateral estoppel should not apply. See id. Neither of these arguments is persuasive. The application of collateral estoppel does not depend on whether new evidence has been uncovered or whether the plaintiff has identified a different cause of action; instead, collateral estoppel depends on "the identity of the issues that were litigated" in the earlier suit. Ohio Willow Wood Co. v. Alps S., LLC, 735 F.3d 1333, 1342 (Fed. Cir. 2013); see also Black v. Office of Pers. Mgmt., 641 F. App'x 1007, 1009 (Fed. Cir. 2016) (). Here, (1) plaintiff implicitly concedes that the '058 and '765 applications are substantively identical to...
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